I have spilled alot of pixels detailing the weakening Housing market, and its potential impact on the economy.
But not all is woe in the Real Estate market: In select locations, things aren’t so bad.
Indeed, in one very specific area, and in a rather particular slice of Housing, things are actually pretty rosy: The very very high end of Manhattan. The upper tier of homes in NY County — the top 3% — are still seeing robust sales, and actually enjoying price gains.
The New York Times detailed this yesterday in $6 Million for the Co-op, Then Start to Renovate:
"While the general housing market is cooling off in much
of the country, brokers in New York say that the demand at the high end
still resembles a luxury- home arms race. Manhattan residents in the
third quarter of this year paid 19 percent more than they did a year
earlier for co-ops with four bedrooms or more, compared with an 11
percent gain for the average one-bedroom apartment, according to data
tracked by the brokerage firm Brown Harris Stevens.
So far this year, 324 buyers purchased Manhattan apartments worth
more than $5 million; of those 16 buyers closed on homes that cost more
than $20 million, according to the research firm PropertyShark.com. Another 45 homes are on the market with asking prices of more than $20 million."
The secret? Wealthy purchasers who do not require mortgages! The credit crunch has had zero impact on this market segment:
"Even after paying top dollar for a luxury apartment, most buyers see
the need for more work . . . often embarking on costly and lengthy
renovations intended to reflect not only their own taste but also their
ambitions to find a perch in the social and economic swirl of today’s
Gilded Age. These newly wealthy are crowding into the market not just
to buy the city’s most expensive homes, but to hire its most coveted
decorators, surround themselves with dozens of remodeling specialists,
and ultimately invite friends and colleagues to see their urban
I do enjoy the accompanying chart:
graphic courtesy of NYT
Age of Riches: $6 Million for the Co-op, Then Start to Renovate
NYT, October 6, 2007